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Spectrum Brands Holdings: A Deep Dive Into Margin Sustainability, Inflation Offsets, Cost Takeout Programs & Execution Risk!

Spectrum Brands Holdings reported a challenging but operationally resilient fiscal year, characterized by tariff headwinds, supply chain disruptions, and category softness across several of its core businesses. The company’s performance reflected both the negative effects of macroeconomic volatility and management’s efforts to stabilize operations, reduce costs, and strengthen the balance sheet. Net sales declined 5.2% for the year, primarily due to supply shortages caused by a temporary six-to-eight-week pause on shipments from China during peak tariff periods, as well as weak consumer demand in Global Pet Care and Home & Personal Care. However, the Home & Garden division showed modest growth driven by product innovation and favorable seasonal patterns. Gross margin contracted by 70 basis points to 36.7%, reflecting lower volume, unfavorable mix, inflation, and tariffs, partially mitigated by pricing actions and cost initiatives. Adjusted EBITDA fell to $289 million, down 9.